1. General Issues & Reporting Guidance Emissions Inventory Workshop 2014 1

2. Topics to Discuss  Recent Rule Changes  Lower Reporting Guidance Change  Pneumatic Devices  Typical Reporting Issues  The Invoicing Process Emissions Inventory Workshop 2014 2

3. Changes to Subchapter 5 OAC 252:100-5 Registration, Emission Inventory and Annual Operating Fees Emissions Inventory Workshop 2014 3

4. SC-5 Rule Changes  Became effective September 10, 2013  Minor rule clarifications:  Eliminated requirement to report “physical state of contaminant” and “moisture content of the gas stream”  Updated reporting method to emphasize electronic reporting  Permit number now not required  Confidentiality of proprietary information – corrected reference to the Oklahoma Statute Emissions Inventory Workshop 2014 4

5. SC-5 Rule Changes Inventories for Permit by Rule (PBR) Facilities – New reporting schedule  PBR facilities must submit inventory for 2014 or the first calendar year registered under a PBR (if registered after 12/31/2014)  After the initial inventory submittal:  PBR facility > 5 Ton/year of any RAP – every NEI three year cycle  PBR facility ≤ 5 Ton/year of any RAP – every second NEI three year cycle  PBR facilities may elect to also submit an emissions inventory for non-NEI reporting years Emissions Inventory Workshop 2014 5

6. SC-5 Rule Changes  What this means for Permit by Rule (PBR) facilities for 2013 Reporting:  If a facility applied for a PBR in 2013 then an inventory will NOT be due provided the facility would have qualified for a PBR throughout all of 2013  If there was an equipment change or a decline in production the facility may still need to report for 2013 Emissions Inventory Workshop 2014 6

7. Lower Emission Amount Reporting Guidance Emissions Inventory Workshop 2014 7

8. Lower Emission Amount Reporting Guidance  There is no lower reporting limit in SC-5  AQD provides reporting guidance that is “prudent and practical”  For 2010, 2011 and 2012 reporting years guidance was that emissions of 0.001 tons or greater of any regulated air pollutant must be reported from each process  Recent data analysis and a review of program needs has allowed us to revise this guidance Emissions Inventory Workshop 2014 8

9. Lower Emission Amount Reporting Guidance  For the 2013 Reporting Year our guidance will be emissions of 0.1 tons or greater of any regulated air pollutant at a process must be reported  Key exceptions must still be reported at 0.001 tons or greater per process:  Lead, mercury & hexavalent chromium  Any HAP at a TRI facility  Any HAP from glycol dehydration still vents  Any HAP from large storage tanks (>500 BBL)  Other situations where deemed necessary Emissions Inventory Workshop 2014 9

10. Lower Emission Amount Reporting Guidance  You can still continue to report to 0.001 tons per process if you choose to  Trace Checkbox is available for <0.001 tons if you wish to use this  Contact us to remove unnecessary pollutants Emissions Inventory Workshop 2014 10

11. Pneumatic Devices Emissions Inventory Workshop 2014 11

12. Area Oil & Gas Emissions Tool Emissions Inventory Workshop 2014 12 Source CategoryVOC (TPY) Artificial Lift87 Associated Gas1,295 Condensate Tanks20,944 Crude Oil Tanks25,825 Dehydrators5,829 Drill Rigs162 Fugitives11,206 Gas-Actuated Pumps15,932 Heaters577 Hydraulic Fracturing16 Lateral/Gathering Compressors511 Liquids Unloading20,658 Loading Emissions4,823 Mud Degassing11,094 Pneumatic Devices86,614 Produced Water0 Well Completions1,917 - Natural Gas well completions 334 Wellhead Compressor Engines1,044 Total208,533

13. Area Oil & Gas Emissions Tool More information: CenSARA Study www.deq.state.ok.us/AQDnew/emissions/OilandGas AreaEmissions www.deq.state.ok.us/AQDnew/emissions/OilandGas AreaEmissions EPA National Oil & Gas Emissions Estimation Tool www.epa.gov/ttn/chief/net/2011inventory.html Emissions Inventory Workshop 2014 13

14. Pneumatic Devices  Pneumatic Devices account for over 40% of all VOC emissions from wellhead facilities  Poorly characterized source that is present at many types of Oil & Gas production, processing and transmission facilities  Need to start collecting more data to improve both point and area inventories  2014 will be an important reporting year  Optional to report for 2013, required for 2014  Work with companies this year to constrain uncertainties in counts and bleed rates Emissions Inventory Workshop 2014 14

15. Pneumatic Devices Specific SCC’s are now available in Redbud, depending on:  One of three device types (matches Subpart W GHG reporting):  Low Bleed (≤ 6 scf/hr)  High Bleed (> 6 scf/hr)  Intermittent  One of four sectors:  Gas Production (SIC 1311)  Oil Production (SIC 1311)  Gas Processing (SIC 1321)  Gas Transmission(SIC 4922) Emissions Inventory Workshop 2014 15

16. Emissions Inventory Workshop 2014 16

17. General Reporting Issues Emissions Inventory Workshop 2014 17

18. Change of Ownership Emissions Inventory Workshop 2014 18 Responsibilities of the:  Transferor (Seller) “The transferor shall notify the DEQ using a prescribed form no later than 30 days following the change in ownership.”  Transferee (Purchaser) “The transfer of ownership of a stationary source or a facility is an administrative amendment that shall subject the new owner or operator to existing permit conditions and/or compliance schedules.”

19. Change of Ownership Emissions Inventory Workshop 2014 19  What this means for the new owner:  Responsibilities transfer unless explicitly stated in contract or sale agreement.  New owner is responsible for providing the complete year’s inventory - Even if sale took place within the reporting year

20. Changing Facility Information Form #100-883 Emissions Inventory Workshop 2014 20

21. Changing a Responsible Official Form #100-882 Emissions Inventory Workshop 2014 21

22. Status of Inactive Facilities  Reset to Active for New Reporting Year  Status Must be Verified Yearly  If Active at any time, status is Active for that reporting year Emissions Inventory Workshop 2014 22

23. Facility Status  New Classification – “Not yet built”  E.g., permit applied for in 2013 but construction has not yet started  Add a brief facility note if necessary  Exempt or De Minimis facilities must be removed completely from Redbud  Contact us to do so Emissions Inventory Workshop 2014 23

24. Emission Unit and Stack Status  Operating – operated all or part of the calendar year  Temporarily Shutdown – did not operate at all during the calendar year, but may restart at sometime in the future  Permanently Shutdown – has been physically removed or is permanently shutdown Emissions Inventory Workshop 2014 24

25. Emission Unit and Stack Status Operating and Temporarily Shutdown: Remains in your inventory Permanently Shutdown: Drops from your inventory the next year  Example: Emission unit operated through June 2013 then physically removed from the facility in September 2013 Status for 2013 – Operating Status for 2014 – Permanently Shutdown Status for 2015 – Not in inventory Emissions Inventory Workshop 2014 25

26. Replacement Equipment  Create a new emission unit  Report data for original and replacement equipment separately  Preferably include notes explaining the situation at both units  Report original equipment as permanently shutdown the next year. It will then drop out of the inventory in the second year. Emissions Inventory Workshop 2014 26

27. Ensure Data is Consistent If Emission Unit Status = Active Operating Hours > 0 Process Rates > 0 Emissions > 0 Emissions Inventory Workshop 2014 27

28. Storage Tank Emissions  Emissions released from the bottom of a tank that has no throughput must be reported  Tank would be reported as Active  Tanks linked together can be reported as a single emission unit  Combined SCC 40400311 (working + breathing + flashing) may be used for condensate tanks with < 6 ton per year total VOC emissions. Emissions Inventory Workshop 2014 28

29. Calculating Condensate Tank Emissions  TANKS Version 4.09D: Estimates VOC and HAP emissions from fixed- and floating-roof storage tanks. Used for calculating working and breathing loss emissions. www.epa.gov/ttnchie1/software/tanks  Vasquez Beggs equation: Used for calculating flashing losses Used for calculating flashing losses www.deq.state.ok.us/aqdnew/resources/Calculations11.xls  RVP 10: Is the closest default to condensate for the TANKS program Is the closest default to condensate for the TANKS program  Report Working, Breathing and Flashing losses Emissions Inventory Workshop 2014 29

30. Common Stack Reporting  If you have all tank emissions going to a flare, create an emission unit for the tank emissions with a flare as the control and another emission unit for the flare itself to show the combustion emissions  BOTH units will list the same common stack  If you have all emissions going to a thermal oxidizer, create an emission unit for the process emissions with a thermal oxidizer as the control and another emission unit for the thermal oxidizer to show the combustion emissions  BOTH units will list the same common stack Emissions Inventory Workshop 2014 30

31. Emissions Inventory Workshop 2014 Common Stack – Flare as Control 31

32. Common Stack – Flare Combustion Emissions Inventory Workshop 2014 32

33. Inventory Corrections  During the reporting season, corrections to the current reporting year are accomplished by making changes in Redbud and resubmitting  Last submission overwrites any earlier ones  Corrections after the reporting season can not be entered in Redbud  Corrections should be marked up in Red on a hardcopy of the Turnaround Document (TAD) from the appropriate year  Corrections must be certified by the Responsible Official with an original signature and mailed to our office  Redbud TAD has a signature page that can be used in these circumstances Emissions Inventory Workshop 2014 33

34. 34 Emissions Inventory Workshop 2014 Certifying Corrections  Submissions made through Redbud during the reporting season do not need a hardcopy signature  The statement below is on all Redbud TAD’s in case it is needed for later hardcopy corrections

35. Redbud Browser Compatibility  Redbud is best used with Internet Explorer 5.5 or higher  To correct compatibility problems with Internet 10 and 11:  Select Tools in your Menu Bar, then select compatibility view  Add state.ok.us to the compatibility view Emissions Inventory Workshop 2014 35

36. Air Quality Operating Fee Invoicing Process Emissions Inventory Workshop 2014 36

37. Annual Operating Fee Invoices  Invoices are mailed on July 1, normally addressed to the Responsible Official  Emissions are billed 2 years in arrears  CY 2014 Operating fees will be based on CY 2012 emissions  Payment due 30 days after billing  Companies with <5 Tons total are not invoiced Emissions Inventory Workshop 2014 37

38. Annual Operating Fee Invoices  PBR facilities will be assessed an annual operating fee each year based on the most recent emissions inventory submission.  The current facility owner is responsible for invoiced fees regardless of facility ownership during the year in which emissions were released.  Title V fees are adjusted yearly based on the CPI. The 2014 Title V fees will be $36.33 per ton.  Non-Title V fees are fixed at $25.12 per ton. Emissions Inventory Workshop 2014 38

39. Heads Up!  2014 will be an important reporting year  Triennial NEI year, likely base year for non-attainment planning  Data quality will be vital for developing effective control strategies  Get 2013 in best possible shape now  Comprehensive 2014 inventory of Oil & Gas area and point sources will be critical  All PBR facilities will have to report for 2014  We are developing processes for companies with large numbers of similar facilities to directly export from their databases to Redbud  Avoids needing to do data entry in Redbud  Not necessarily easy – requires significant technical expertise Emissions Inventory Workshop 2014 39

40. Important Proposed Change for Reporting VOC in 2014  Go from reporting Speciated HAPs plus VOC (non-HAP) to Total VOC plus HAPs  Should reduce errors and confusion  Consistency with most published emission factors  Oklahoma Clean Air Act does not allow double billing for pollutants that are in multiple categories  Invoices will continue to charge for HAPs and VOC (non-HAP)  Allow industry sufficient lead time to prepare for this change Emissions Inventory Workshop 2014 40

41. Questions? 41 Emissions Inventory Workshop 2014

42. Thanks for Coming Today  Please complete the feedback form before you leave Emissions Inventory Workshop 2014 42